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G. S. PAPER II – GOVERNANCE, SOCIAL JUSTICE

Development processes and the development industry- the role of

NGOs, SHGs, various groups and associations, donors, charities and

other stakeholders

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Q. Why has ‘participation’ and ‘empowerment’ gained wide currency in recent development literature?

Decades of development efforts have provoked a feeling of disenchantment with the conventional growth-oriented

strategy of development not producing the desired trickle-down effect. The failures sensitized the planners and

administrators to the need for drawing on the indigenous knowledge system of the local people. Unless people

themselves participate, the programmes administrated by external agencies remain exogenous to the rural

community thereby affecting results. A people-centred vision is being advanced by citizen’s organisations working to

create an alternative world order based on economic justice, environmental stability and political inclusiveness.

As the Human Development Report (UNDP 1993) commented: “People’s participation is becoming the central issue of

our times”

Q. So, is people participation a recent discovery?

‘People’ as real actors in history have been brought forward by the ‘Subaltern’ school. Peasant resistances were

subtle and effective peoples’ actions against oppression. People do act, it is for us to appreciate it and mobilise it for

participatory people-centric movements. People as development actors emerged long ago in the vision and action of

Tagore at Shantiniketan and Gandhi at Wardha. Tagore experimented with people centred rural development in the

villages for the rejuvenation of rural arts and crafts and economy in general. Gandhi relied on the mobilization of

masses and their economic upliftment through the development of cottage and small-scale industries

Q. Ok. I get that participatory development is important. What shapes/forms does it take?

AnisurRahman has identified the following different forms of community organisations representing collective action

by the underprivileged people to improve their socio-economic conditions:

• First, there are grassroots organisations that are basically economic in nature, undertaking income-generating activities with the help of internal resource mobilization supplemented by resource and knowledge support

from outside

• Second, there are other organisations that emerge in ‘pressure group’ activities. They resist exploitation or oppression by other groups, assert economic, social and human rights including women’s rights, or demand

services from the public agencies

• Third, some of the organisations undertake social and cultural activities in such areas as health, education, culture and so on

• Fourth, some aim at the promotion of holistic life by way of activities that integrate spiritual advancement with economic and social development

• Fifth, community organisations to promote ecologically oriented socio-economic life are also growing in many areas such as organic agriculture, social forestry, coastal fishing etc.

• Sixth, participatory action research is being pursued by some organisations to develop people’s own thinking about their living conditions and environment

Q. This proliferation of community based organisations must be backed by some benefits, right?

The value of participation as a facilitative development process has been widely recognised and major benefits have

been identified as follows:

• The participatory process provides important information in the planning, programming and implementation stages thereby ensuring congruence between objectives and community values and preferences

• By rationalizing manpower resources utilization, the process reduces project cost • Any change brought about through development is more acceptable to the community if the local people are

involved, also, mistakes are more tolerable if these are made by people who have to live with them

• Monitoring is better, and sustainability of the project is more likely even after the withdrawal of the external agent, be it government or NGO agency


• The community learns from its own involvement and from this point of view, participation is a 2 way learning process in which the administrator and the people become co-learners

• Active community participation helps rebuild community cohesion and installs a sense of dignity into the community. People gain in confidence and steadily emerge as real actors in the development process.

Q. Is community participation then- the answer to all development problems?

Critics of community participation argue: participation has popularity without clarity and is subject to growing

faddishness and a lot of lip service.

Serious analysis of local community life reveals differentiation in terms of status, income and power. Conflicts and

rivalries are not uncommon even among the poor and underprivileged. The romantic vision of frictionless,

harmonious community life does not match ground realities

External intervention by social workers or political activists has been found necessary almost everywhere to organize

the local community and mobilize the local people

It has also been observed that there is an imaginary notion of continuous activism by the local people behind all

discussions on community participation. Total and continuous commitment to activism is more a revolutionary’s

dream than the poor people’s actual behaviour

There are critics who doubt the efficacy of community participation in bringing about radical change in the life of the

poor and the underprivileged through autonomous local action only. Small changes are not ruled out, but community

participation,to be really effective, needs profound social structural change at both domestic and international levels.

Community mobilization cannot, on its own, correct the basic social imbalances that have their roots in deeper socio-

economic layers of the society

Marxist argument: participatory development within capitalistic mode is unworkable, the purpose of participation is

to diffuse revolutionary movements and create an illusion of solution. The state seeks to subvert popular movements

through manipulative co-optation of the poor

Q. Okay. Participatory development has its faults and shortcomings but it does stand for action, equity in resource

distribution & social capital and hence cannot be ignored. What is the role of state in all this?

The state plays a fundamental role in helping or hindering participation. Different social science theories evoke

different images of state-society relationships. While Marxian and elite theories are pessimistic about the possibility

of community participation, liberal-democratic and pluralist theories are much more helpful.

State’s actions depend upon the definition and purpose of community participation, state’s perception about its role

and the political will to decentralize power and resources to local institutions

Accordingly 4 different state’s responses have emerged (ideal models to characterize better):

Anti-participatory mode: The state in a capitalist system is interested, not in ameliorating the conditions of the poor,

but in promoting the interests of capital and the ruling class. Power is, therefore, concentrated and not dispersed to

facilitate accumulation of wealth

Manipulative mode: The state follows a diplomatic approach and the state support to community participation is

intended to ensure political and social control as well as reduce local development costs and facilitate successful

project implementation. State seeks to neutralize political opposition by co-opting autonomous movements with the

ulterior motive of gaining control over them. The rhetoric of participation is invoked to mobilize local labour in state’s

development activities and to give legitimacy to the regime in power

Incremental mode: It is marked by an ambivalent approach to community participation. There is no lack of

government support to participation but the policy is unclear and piecemeal & ad-hoc approaches are the norm. The

state in reality is not willing to part with power and to devolve resources to local community groups. Also, the

bureaucrats and the technocrats have their own ways of bringing about “efficient” local development management.

Still, community participation is not, in theory, rejected and decentralisation continues in an ad-hoc fashion with a

plurality of actors


Participatory mode: Characterized by state’s own initiative to create institutions of community participation to ensure

effective involvement at the grassroots level. There are no ulterior motives and genuine popular involvement is

ensured by providing resources to local bodies and sensitizing bureaucracy through training and directives. Within an

overall development planning framework, the central, regional and local development policies and activities are

harmonized through positive political will and bureaucratic support

[Follow-up Q: Which of these modes is true for India? Have we evolved from one mode to another or is there one

particular mode more applicable or does the state adopt different modes at different times/places]

Enough of participation, lets come to voluntary organisations:

Q: What is a NGO?

According to the World Bank, “a Non-governmental Organization (NGO) is a private organization that pursues

activities to relieve suffering, promote the interests of the poor, protect the environment, provide basic social

services, or undertake community development”. In other words, NGOs are legally constituted organizations, operate

independently from the government and are generally considered to be “non-state, non-profit oriented groups who

pursue purposes of public interest”. The primary objective of NGOs is to provide social justice, development and

human rights. NGOs are generally funded totally or partly by governments and they maintain their non-governmental

status by excluding government representatives from membership in the organization.

In a democratic society, it is the state that has the ultimate responsibility for ushering development to its citizens. In

India, through the progressive interpretation of the Constitution and its laws and policies, the scope of development

has been significantly broadened to include not just economic progress for citizens, but also promotion of social

justice, gender equity, inclusion, citizen’s awareness, empowerment and improved quality of life. To achieve this

holistic vision of development, the state requires the constructive and collaborative engagement of the civil society in

its various developmental activities and programs. Non-governmental organisations (NGOs) as the operational arm of

the civil society therefore have an important role in the development processes.

Q: What are the different types of civil society organizations?

• Civil rights advocacy organizations: to promote human rights of specific social groups e.g. women, migrants, disabled, HIV, sex workers, Dalit people, tribal people, and the likes.

• Civil liberties advocacy organizations: to promote individual civil liberties and human rights of all citizens, rather than focusing on particular social group.

• Community based organizations, citizen’s groups, farmers’ cooperatives: to increase citizen’s participation on public policy issues so as to improve the quality of life in a particular community.

• Business and industry chambers of commerce: to promotion policies and practices on business. • Labour unions: to promote the rights of employees and workers. • International peace and human rights organizations: to promote peace and human rights. • Media, communication organization: to produce, disseminate, or provide production facilities in one or more

media forms; it includes television, printing and radio.

• National resources conservation and protection organizations: to promote conservation of natural resources, including land, water, energy, wildlife and plant resources, for public use.

• Private and public foundations: to promote development through grant- making and partnership. • Also the Civil society includes - Political Parties; Religious Organizations; Housing cooperatives, slum dwellers

and resident welfare associations.

Q: What has been the interaction and relationship between the Indian state and NGOs like?

In India the state policies have significantly influenced the formation of NGOs and their activities. The government

sponsored and aided programmes provided financial assistance to NGOs either as grants or as matching grants to

support the implementation of social development projects. The need for the involvement of voluntary organisations

has been acknowledged by a number of official committees dealing with development.


BalwantRai Mehta Committee, 1957: Today in the implementation of the various schemes of community

development, more and more emphasis is laid on NGOs and workers and on the principle that ultimately people’s

own local organisations should take over the entire work

Rural-Urban Relationship Committee, 1966: Local voluntary organisations can be very helpful in mobilizing popular

support and assistance of the people in the activities of local body. It is possible to maintain constant and close

contact with the people through these organisations

Ashok Mehta Committee: Of the several voluntary organisations engaged in rural welfare, a few have helped the PRIs

in preparation of area development plans, conduct feasibility studies and cost/benefit analysis, explore ways and

means to induce local participation in planning and implementation.

In the Sixth Five Year Plan (1980-1985), the government identified new areas in which NGOs as new actors could

participate in development

The Seventh Five Year Plan (1985- 1990), envisioned a more active role for NGOs as primary actors in the efforts

towards self-reliant communities. This was in tune with the participatory and empowerment ideologies, which was

gaining currency in the developmental discourse at that time

Government support and encouragement for NGOs continued in the Eighth Five- year plan, where a nation-wide

network of NGOs was sought to be created

The Ninth Five-year plan proposed that NGOs should play a role in development on the public-private partnership

model. Also, the agricultural development policies of the government and its implementation mechanisms provided

scope and space for NGOs. A case in point is the watershed development program, which has led to the growth of

NGOs working for rural development

In March 2000, the Government declared Planning Commission as the nodal agency for GO-NGO interface. The

message was clear- government has to and will work with the voluntary sector. A ‘Civil Society Window’ was started

in 2004, in the hope that it would enable people to engage with the Planning Commission and offer the benefit of

their field experiences

During the 11th Five Year Plan process a regional consultation was organised to get civil society feedback.

Participation of Civil Society (CS) had thus already become a strong and robust element in the preparation of the Plan

Consultations with citizens on the Approach Paper to the 12th Plan began on many platforms, including the internet.

Members of Planning Commission travelled across the country attending Public Meetings called by CS around various

sectoral issues to gather inputs for the 12 Five Year Plan

National Policy on the Voluntary Sector, 2007:Recognizes the contribution of the voluntary sector and the need for

Government- Voluntary Sector partnership and that project grants are a useful means for both the Government to

promote its activities without its direct involvement and a valuable source of support to small and medium Voluntary

Organizations. It highlights the need for Government to encourage all Central and State Government agencies to

introduce pre-service and in-service training modules on constructive relations with voluntary organizations. It

recognizes the difficulties faced by the voluntary sector in accessing government schemes and suggests ways to tackle

this. The main objective of the National Policy on the Voluntary Sector is to identify systems by which the Government

may work together with the Voluntary Organizations on the basis of the principles of mutual trust, respect and shared

responsibility. It also recognizes the importance of independence of voluntary organizations, which allows them to

explore alternative models of development. The National Policy on the Voluntary Sector is just the beginning of the

process to evolve a new working relationship between the government and the voluntary sector without affecting its

autonomy and identity. There are many areas in which help of the voluntary sector is sought- for social audits,

behaviour change, good governance and increasingly even for better service delivery.

Q: How has India benefitted from NGOs?

India has a long history of civil society based on the concepts of “daana” means giving and “seva” means service.

Voluntary organizations were active in cultural promotion, education, health, and natural disaster relief as early as the

medieval period. During the second half of the 19th century, nationalist consciousness spread across India and self-

help emerged as the primary focus of socio-political movements. The early examples of such attempts are Friend-in-

Need Society (1858), Prathana Samaj (1864), Satya Shodhan Samaj (1873), Arya Samaj (1875), the National Council for


Women in India (1875), the Indian National Conference (1887) etc. The Society’s Registration Act (SRA) was approved

in 1860 to confirm the legal status of the growing body of non-governmental organizations.

In India, it was the 1970s which saw rapid growth in the formation of formally registered NGOs and the process

continues to this day. Most NGOs have created their respective thematic, social group and geographical priorities such

as poverty alleviation, community health, education, housing, human rights, child rights, women’s rights, natural

resource management, water and sanitation; and to these ends they put to practice a wide range of strategies and

approaches. Primarily, their focus has been on the search for alternatives to development thinking and practice;

achieved through participatory research, community capacity building and creation of demonstrable models. When

we review some of the work done by NGOs over the past 3 decades, we find that they have contributed greatly to

nation building.

Many NGOs have worked hard to include children with disability in schools, end caste- based stigma and

discrimination, prevent child labour and promote gender equality resulting in women receiving equal wages for the

same work compared to men. During natural calamities they have played an active role in relief and rehabilitation

efforts, in particular, providing psycho-social care and support to the disaster affected children, women and men.

NGOs have been instrumental in the formation and capacity building of farmers and producers’ cooperatives and

women’s self- help groups. Several NGOs have worked hand in hand with the Government to ensure that millions of

out of school children are enrolled and continue their school education, thus making the right to education a reality.

The leprosy eradication programme was spearheaded by NGOs and today only residual leprosy remains in our

country. NGOs have implemented the JeevanDhara programme for creation of wells for safe drinking water;

promoted community toilets for total sanitation, and supported the public health programs on immunisation and for

eliminating tuberculosis and malaria. The much celebrated NREGA, ICDS, ICPS, Nirmal Gram and SwasthyaBima of the

government have their roots in the work of many NGOs. NGOs have significantly influenced the development of laws

and policies on several important social and developmental issues such as the right to information, juvenile justice,

ending corporal punishment in schools, anti-trafficking, forests and environment, wildlife conservation, women,

elderly people, people with disability, rehabilitation and resettlement of development induced displaced people to

name a few. Further, NGOs made their modest attempts to ensure the effective implementation of these laws and

policies by conducting and disseminating findings from participatory research, budget analysis, public hearings, social

audits, workshops, seminars and conferences.

Summing up, it is now well established that NGOs have an important role to play in the development processes and

that both the state and market need the collaboration of credible, active, and accountable NGOs. Given their connect

with the grassroots realities, NGOs can and should play the “game changer” to pro-poor development through

leadership on participatory research, community empowerment and search for development alternatives.

With the increasing role of the NGOs in development activities they are now attracting professionals from various

other sectors, and capacities are being built in support areas such as financial management, resource mobilization,

human resources, leadership development, governance procedures and practices and institutional development. At

another level NGOs have been addressing the social service issues and empowerment related advocacy efforts have

been increasing. The study conducted by a New Delhi based NGO concluded that every fifth NGO in India works on the

issues of community and social service. The favourable disposition of the governments and the political will to involve

NGOs is more pronounced in implementation of the welfare schemes addressing causes of women and children.

Further, the industrial policies have influenced the formation and relations between the businesses and NGOs. The

Confederation of Indian Industries (CII), a leading organisation, has been raising the issues of corporate social

responsibility. The emphasis of industrial policies on the promotion and development of small, cottage and village

industries has also lead to the formation of agencies such as the Khadi and Village Industries Commission, Small

Industries Associations and likes.

Profiling NGOs:

India has possibly the largest number of active non-government, non-profit organizations in the world. There has been

a sharp increase in the number of new NGOs in the past decade in India. According to a government study, there were

only 1.44 lakh registered societies till 1970. The maximum increase in the number of registrations happened after

2000. A recent study commissioned by the government showed that there are about 3.3 million NGOs in India by the

end of 2009 i.e., one NGO for less than an average of 400 Indians. Even this staggering number may be less than the

actual number of NGOs active in the country. This is because the study, commissioned in 2008, took into

consideration only those entities which were registered under the Societies Registration Act, 1860 or the Mumbai

Public Trust Act and its variants in other states.


It can be noted that a great majority of the NGOs are small and about three-fourths of all NGOs are run entirely by

volunteers. About 13 percent of the NGOs have between 2 to 5 employees; about 5 percent have between 6 to 10

employees and only about 8.5 percent NGOs employ more than 10 people. According to a survey conducted by

society for Participatory Research in Asia (PRIA), 73.4 percent of NGOs have one or no paid staff, although across the

country, more than 19 million persons work as volunteers or paid staff at an NGO. More often NGOs are registered as

trusts, societies, or as private limited non-profit companies, under Section- 25 of Indian Companies Act, 1956. They

also enjoy income tax exemption. Foreign contributions to non-profits are governed by Foreign Contribution

Regulation Act (FCRA), 1976.

Q: What are the key governance challenges facing NGOs?

In view of the emergence of a new paradigm of scaling up, in which NGOs are seen as catalysts of policy innovations

and social capital; as creators of programmatic knowledge that can be spun off and integrated into government and

market institutions; and as builders of vibrant and diverse civil societies, it’s imperative to critically analyze the role of

NGOs in the process of development and understanding the challenges facing the sector.

Transparency and accountability are key ingredients of Governance in the NGO Sector as these determine operational

efficiencies and risk mitigation. Over the years, corporate sector has been able to recognize and implement best

governance practices through appropriate institutional framework. However, the NGO sector is yet to evolve any

institutionalized framework, which could potentially play an important role in overall development of the nation.

NGOs play an increasingly active role in today’s political and social arenas. Civil society organizations are increasing in

number all over India. Of late, some of the local and national NGOs have been found involved in malpractices and

acting irresponsibly, thus undermining the credibility of civil society. It’s a huge concern and poses a great challenge to

the development movement spearheaded by NGOs in the country.

There is a huge flow of funds into the non-government organization sector and this requires prudence and good

practices to maintain accountability and transparency to the benefit of all stakeholders. Although NGOs do internal

auditing but for more accountability and transparency, it is advisable to go through external auditing also, especially

where public funds are involved. Hence, issues of internal control mechanisms, professionalism, accountability,

transparency and financial management must be given impetus. The challenge is multidimensional, and is

compounded by the‘unorganised’ nature of the sector, lack of regulatory frameworks and the fact that India boasts of

more than a million NGOs of different roles, structures and sizes. In particular, the Indian voluntary sector urgently

needs self-regulatory guidelines and transparency mechanisms to increase the trust and awareness as to how the

philanthropic funds are being utilised.

This is a critical challenge that creates a barrier to raising funds and capital for the sector. The general lack of

transparency in the functioning of a large proportion of NGOs leads to aversion in donating funds for charitable causes

since the general public is largely cynical about the ‘genuineness’ of the non-profit spirit of the sector. The stringent

governance standards of an NGO will facilitate the effective management and increase the accountability to its

stakeholders including donors, the government and the community. It is in the self-interest of the NGOs to realize the

fact that to implement a structure of ‘corporate governance’ principles would provide the real value to the

stakeholders.

Also, this would enable to track the potentially dubious sources of funding coming in for the voluntary sector – an

aspect which has gained impetus in the wake of the increased number of terror attacks and extremist activities.

Recently, the Union Home Ministry has identified some NGOs as security threat to the country. Such security

considerations have underscored the rising need of improving the governance practices in the Indian NGOs and

exercising better regulatory mechanisms, disclosure norms, and management processes including financial

management and budgeting systems as well. Moreover, in the larger interest going beyond the security

considerations, the impetus has to be on inculcating a culture of including performance goals, conducting financial

and performance audits, and reforms for increasing the operational accountability and transparency in the eyes of the

public, volunteers, donors and other stakeholders.

Suggestions:

The implementation of a strategic framework is essentially important in the management of an NGO. The

endorsement of such a framework brings in professionalism and internal control mechanisms, which further makes

the organization’s performance more effective. Developing strategies also include establishing a mechanism of

consistent monitoring of whether they are being implemented and linking the results to the organization’s goals.


There is need to bolster public confidence in the voluntary sector by opening it up to greater public scrutiny. The

Government should encourage Central and State level agencies to introduce norms for filing basic documents in

respect of NGOs, which have been receiving funding by Government agencies and placing them in the public domain

(with easy access through the internet) in order to inculcate a spirit of public oversight.

Public donation is an important source of funds for the NGO sector and one that can and must increase substantially.

Tax incentives play a positive role in this process. The Government could simplify and streamline the system for

granting income tax exemption status to charitable projects under the Income Tax Act. At the same time, the

Government might consider tightening administrative and penal procedures to ensure that these incentives are not

misused by paper charities for private financial gain.

The Government should encourage all relevant Central and State Government agencies to introduce pre-service and

in-service training modules on constructive relations with the voluntary sector. Such agencies need to introduce time

bound procedures for dealing with the VOs. These could cover registration, income tax clearances, financial

assistance, etc. There must be a formal system for registering complaints and for redressing grievances of NGOs.

The Government should encourage setting up of Joint Consultative Groups / Forums or Joint Machineries of

government and voluntary sector representatives, by relevant Central Departments and State Governments. It also

needs to encourage district administrations, district planning bodies, district rural development agencies,

zillaparishads and local governments to do so. These groups could be permanent forums with the explicit mandate to

share ideas, views and information and to identify opportunities and mechanisms of working together. The

Government also might introduce suitable mechanisms for involving a wide cross-section of the voluntary sector in

these Groups/Forums.

Summing Up:

We are entering into an important phase where there are many targets that the government intends to achieve with

the active collaboration of VOs, in the 12th

plan. Therefore, it is important to conduct an effective review or report

card of the National Policy with specific recommendations. These recommendations could become an agenda for all

Voluntary Organizations, Planning Commission, state governments and national Ministries. Efforts are also needed to

further disseminate the information about the policy and its intentions with small VOs as well as government

functionaries. There is a need to solicit commitment from state governments and national ministries. A systematic

intervention is also needed to get National Policy approved and adopted by the Indian Parliament. The most serious

challenge faced by India today is the conflict between violent and non-violent approach of development. Needless to

say that majority of population of India is still deprived of basic fruits of development, but rather than adopting the

approach which is more inclusive and look for solutions within the constitution, India is faced by disturbances in many

parts of the country. This not only hampers the development projects but also shrink the space for people’s

participation to achieve their goals through peaceful means. The voluntary sector being present in such locations

faces the challenge of delivering the services and even mobilizing people on the development agenda. The need of the

hour is to work closely with each other for the benefit of the marginalized people, as even today the dream of

Mahatma Gandhi has not been achieved.

Having looked at NGOs, now let us take a look at SHGs:

Q: What are SHGs?

Self-Help Groups are informal associations of people who choose to come together to find ways to improve their living

conditions. They help to build Social Capital among the poor, especially women. The most important functions of a

Self-Help Groups are

• to encourage and motivate its members to save • to persuade them to make a collective plan for generation of additional income • to act as a conduit for formal banking services to reach them.

Such groups work as a collective guarantee system for members who propose to borrow from organised sources.

Consequently, Self-Help Groups have emerged as the most effective mechanism for delivery of micro-finance services

to the poor. The range of financial services may include products such as deposits, loans, money transfer and

insurance.


Q: Evolution of the SHG movement in India:

The first organised initiative in this direction was taken in Gujarat in 1954 when the Textile Labour Association (TLA) of

Ahmedabad formed its women’s wing to organise the women belonging to households of mill workers in order to

train them in primary skills like sewing, knitting embroidery, typesetting and stenography etc. In 1972, it was given a

more systematized structure when Self Employed Women’s Association (SEWA) was formed as a Trade Union under

the leadership of Ela Bhatt. She organised women workers such as hawkers, vendors, home based operators like

weavers, potters, papad / agarbatti makers, manual labourers, service providers and small producers like cattle

rearers, salt workers, gum collectors, cooks and vendors with the primary objective of (a) increasing their income and

assets; (b) enhancing their food and nutritional standards; and (c) increasing their organisational and leadership

strength. The overall intention was to organise women for full employment. In order to broaden their access to

market and technical inputs, these primary associations were encouraged to form federations like the Gujarat State

Mahila SEWA Cooperative Federation, Banaskantha DWCRA, Mahila SEWA Association etc. Currently, SEWA has a

membership strength of 9,59,000 which is predominantly urban. In the 1980s, MYRADA – a Karnataka based non-

governmental organisation, promoted several locally formed groups to enable the members to secure credit

collectively and use it along with their own savings for activities which could provide them economically gainful

employment.

Major experiments in small group formation at the local level were initiated in Tamil Nadu and Kerala about two

decades ago through the Tamil Nadu Women in Agriculture Programme (TANWA) 1986, Participatory Poverty

Reduction Programme of Kerala, (Kudumbashree) 1995 and Tamil Nadu Women’s Development Project (TNWDP)

1989. These initiatives gave a firm footing to SHG movement in these states. Today, around 44% of the total Bank-

linked SHGs of the country are in the four southern States of Andhra Pradesh, Tamil Nadu, Karnataka and Kerala.

The positive experience gained from the above programmes has led to the emergence of a very strong consensus that

the twin concepts of (a) small group organisation and (b) self-management are potent tools for economic and social

empowerment of the rural poor. Efforts have been made almost in all parts of the country to adopt this model as a

necessary component of the poverty alleviation programmes.

Forming small groups and linking them to bank branches for credit delivery has been the most important feature of

the growth of the SHG movement in our country. The SHG-Bank linkage programme was started as a test project in

1989 when NABARD, the Apex Rural Development Bank in the country, sanctioned Rs.10.0 lakhs to MYRADA as seed

money assistance for forming credit management groups. In the same year, the Ministry of Rural Development

provided financial support to PRADAN to establish Self-Help Groups in some rural pockets of Rajasthan. On the basis

of these experiences, a full-fledged project involving a partnership among SHGs, Banks and NGOs was launched by

NABARD in 1992. In 1995, acting on the report of a working group, the RBI streamlined the credit delivery procedure

by issuing a set of guidelines to Commercial Banks. It enabled SHGs to open Bank Accounts based on a simple inter-se

agreement. The scheme was further strengthened by a standing commitment given by NABARD to provide refinance

and promotional support to Banks for credit disbursement under the SHG – Bank linkage programme. NABARD’s

corporate mission was to make available microfinance services to 20 million poor households, or one-third of the poor

in the country, by the end of 2008. In the initial years, the progress in the programme was a slow; only 33000 groups

could be credit linked during the period 1992-99. But, thereafter, the programme grew rapidly and the number of

SHGs financed increased from 82000 in 1999-2000 to more than 6.20 lakhs in 2005-06 and 6.87 lakhs in 2006-07.

Cumulatively, 33 million poor households in the country have been able to secure access to micro-finance from the

formal banking system.

(As a follow-up read up on the success stories particularly the Kudumbashree programme of Kerala in ARC 2 - Report

09 Social Capital Page 80-81)

Q: What other Agencies are involved in the SHG movement?

Apart from NABARD, there are four other major organisations in the public sector which too provide loans to financial

intermediaries for onward lending to SHGs. They are (a) Small Industries Development Bank of India (SIDBI),

(b)RashtriyaMahilaKosh (RMK), (c) Housing and Urban Development Corporation (HUDCO) and(d) then, there are

public sector/other commercial banks which are free to take up any lending as per their policy and RBI guidelines.


RashtriyaMahilaKosh:

The RashtriyaMahilaKosh was set up by the Government of India in March 1993 as an Autonomous Body registered

under Societies Registration Act, 1860 under the Department (now Ministry) of Women and Child Development. The

objective was to facilitate credit support to poor women for their socio-economic upliftment.It was felt that the credit

needs of poor women, especially those in the unorganized sector, were not adequately addressed by the formal

financial institutions of the country. Thus RMK was established to provide loans in a quasi-formal credit delivery

mechanism, which is client-friendly, has simple and minimal procedure, disburses quickly and repeatedly, has flexible

repayment schedules, links thrifts and savings with credit and has relatively low transaction costs both for the

borrower and the lender. The Kosh lends with a unique credit delivery model “RMK – NGO-SHG- Beneficiaries”. The

support is extended through NGO’s, Women Development Corporations, State Government agencies like DRDA’s,

Dairy Federations, and Municipal Councils etc.

SIDBI:

Small Industries Development Bank of India (SIDBI) launched its micro finance programme on a pilot basis in 1994

using the NGO / MFI model of credit delivery wherein such institutions were used as financial intermediaries for

delivering credit to the poor and unreached, mainly women. Learning from the experience of the pilot phase, SIDBI

reoriented and upscaled its micro finance programme in 1999. A specialised department viz. ‘SIDBI Foundation for

Micro Credit’ (SFMC) was set up with the mission to create a national network of strong, viable and sustainable Micro

Finance Institutions (MFIs) from the informal and formal financial sectors. SFMC serves as an apex wholesaler for

micro finance in India providing a complete range of financial and non-financial services to the MFIs so as to facilitate

their development into financially sustainable entities, besides developing a network of service providers and

advocating for appropriate policy framework for the sector. SFMC is implementing the National Micro Finance

Support Programme (NMFSP). The overall goal of NMFSP is to bring about substantial poverty elimination and

reduced vulnerability in India amongst users of micro-finance services, particularly women.

Private Initiatives:

Though, government efforts have played a major role in advancing the SHG movement in the country, there have

been a large number of voluntary organisations (NGOs) which too have facilitated and assisted SHGs in organizing

savings and credit in different parts of India. SEWA in Ahmedabad, MYRADA in Karnataka, Nav Bharat Jagriti Kendra

and Ramakrishna Mission in Jharkhand, and ADITHI in Bihar are some of the names which took the lead in promoting

Self-Help Groups (mostly of women) around income generation activities using local skills. From organizing villagers

into groups which could work on viable activities, to making a project and securing funds (own contribution or

through a tie-up with the financial institution), these VOs have worked with involvement and dedication. PRADAN

(Professional Assistance for Development Action), DHAN Foundation, ASSEFA (Association of SarvaSeva Farms, MALAR

(Mahalir Association for Literacy, Awareness and Rights), SKS, Janodaya, Cohesion Foundation and Jan

ChetnaSansthan are some of the other major non-governmental institutions which are promoting and nurturing a

large number of SHGs of poor people, mostly women into effective organisations which could leverage credit from

formal sources, and develop local resources and skills to increase productivity and income. It is thus, due to the

combined efforts of the government and these private voluntary agencies that the SHGs have come to occupy a place

of prominence in the socio-economic fabric of rural India.

Q: What has been the impact of SHGs on rural life?

A random impact evaluation study covering 560 members of 223 SHGs linked to Banks located in 11 States was carried

out by NABARD. A three year period was selected for this study. The results of this survey released in 200018

indicated that

• 58% of the households covered under SHGs reported an increase in assets; • the average value of assets per household increased by 72% from Rs.6,843 to Rs.11,793; • majority of the members developed savings habit against 23% earlier; • there was a threefold increase in savings and a doubling of borrowings per household; • the share of consumption loan in the borrowing went down from 50% to 25%; • 70% of the loans taken in post-SHG period went towards income generation ventures; • employment expanded by 18%; • the average net income per household before joining a SHG was Rs.20,177 which rose by 33% to 26,889; and • about 41.5% of the household studied were below their state specific poverty line in the pre-SHG enrolment

stage; it came down to 22%.


Participation in group activity significantly contributed to improvement of self-confidence among the members. In

general, group members and particularly women became more vocal and assertive on social and family issues.

The structure of the SHG is meant to provide mutual support to the participants in saving money, preparing a

common plan for additional income generation and opening bank accounts that would help them in developing credit

relationship with a lending institution. It ultimately supports them in setting up micro-enterprises e.g. personalised

business ventures like tailoring, grocery, and tool repair shops. It promotes the concept of group accountability

ensuring that the loans are paid back. It provides a platform to the community where the members can discuss and

resolve important issues of mutual concern.

While some of the SHGs have been initiated by the local communities themselves, many of them have come through

the help of a mentor Body (either government or an NGO) which provided initial information and guidance to them.

Such support often consists of training people on how to manage Bank accounts, how to assess small business

potential of the local markets and how to upgrade their skills. In the end, it creates a local team of resource persons.

Group formation becomes a convenient vehicle for credit delivery in rural areas. Commercial Banks and other

institutions which are otherwise not receptive to the demands of marginalized individuals, start considering such

groups as their potential customers. Overall such Joint-Liability Groups expand the outreach of the micro-finance

programme in an effective way, reaching out to the excluded segments e.g. landless, sharecroppers, small and

marginal farmers, women, SCs/STs etc.

The majority of Self-Help Groups comprise of women members. There is evidence in this country as well as elsewhere

that formation of Self-Help Groups has a multiplier effect in improving women’s status in society as well as in the

family. Their active involvement in micro-finance and related entrepreneurial activities not only leads to improvement

in their socio-economic condition but also enhances their self-esteem. Women in a groupenvironment become more

articulate in voicing their concerns and a change occurs in their self-perception. They start to see themselves not only

as beneficiaries but also as clients / informed citizens seeking better services. On the home front, their new found

awareness and the confidence generated out of their entrepreneurial skills make them more confident vis-à-vis their

menfolk.

The SHG programme has contributed to a reduced dependency on informal money lenders and other non-

institutional sources. It has enabled the participating households to spend more on education than non- client

households. Families participating in the programme have reported better school attendance and lower drop-out

rates.

The financial inclusion attained through SHGs has led to reduced child mortality, improved maternal health and the

ability of the poor to combat disease through better nutrition, housing and health – especially among women and

children.

But the SHG movement has certain weaknesses as well:

• contrarytothevisionforSHGdevelopment,membersofagroupdonotcome necessarily from the poorest families; • the SHG model has led to definite socialempowerment of the poor but whetherthe economic gains are

adequate to bring a qualitative change in their life is a matter of debate;

• many of the activities undertaken by the SHGs are still based on primitive skills related mostly to primary sector enterprises. With poor value addition per worker and prevalence of subsistence level wages, such

activities often do not lead to any substantial increase in the income of group members.

• There is lack of qualified resource personnel in the rural areas who could help in skill upgradation/acquisition of new skills by group members.

Q: What then are the key issues facing SHGs today?

Though, during a short span of fifteen years the SHG movement has recorded remarkable progress much still remains

to be done. The movement shows steep territorial variations. Many areas of the country lack adequate banking

structure. Urban and semi-urban areas, to a large extent, stand excluded from this mode of credit delivery. Further

growth of this movement faces threat from inadequacy of skills in the rural areas. And finally the pace of the

movement needs to be accelerated. The following eight issues of this sector deserve priority attention:


• Maintaining the participatory character:

We saw the cooperative sector became a springboard for political aspirants. Though the SHG movement is relatively

new, government interventions and subsidies have already started showing negative results. The patronage and

subsidies provided to the SHGs by government and the Panchayats often lead to their politicization. Therefore, due

care must be taken to ensure that government initiatives do not erode the fundamental principles of self-help and

empowerment of the poor.

• Need to expand the SHG movement to States such as Bihar, Uttar Pradesh, Madhya Pradesh, Orissa, Rajasthan and

in the North-East (where the SHG movement and micro-finance entrepreneurship is weak):

Overall 73% of the farmer household (in rural areas) have no access to any formal source of credit. In March, 2001,

71% of the total linked SHGs of the country were in just four States of the southern region viz. Andhra Pradesh,

Karnataka, Kerala and Tamil Nadu. The figure went down to 58% in 2005, 54% in 2006 and to 44% in 2007. But even

the current figure is a cause of concern when one talks of financial inclusion for the whole country.

• Need to extend small group organisations (SHGs) to peri-urban and urban areas:

According to the 2001 census, 314.54 million persons changed their place of residence (vis-à-vis the situation in the

1991 census) within the country and out of this 29.90 million or 9% changed their place of residence in search of

better prospects elsewhere. Since issue of any form of identity card is invariably linked with the possession of an

immovable property, such migrant workers do not have any formal document to prove their domicile in the city. But

the overall economic and social well-being of the city is closely linked with the condition of this section of the city

dwellers. In the absence of any documentary proof, it appears that this class of people do not have access to

organised financial services. As per the existing statutory provisions, NABARD’s mandate is to provide micro-finance

facilities only to rural and semi-urban areas. Branches of the mainstream Banks too, though, equipped with

manpower and technology, are not keen to service this sector. Even money lenders are reluctant to lend to them. The

net result is that this segment of the urban population e.g. pavement sellers, street hawkers, construction workers

etc. remains financially excluded.

• Mode of SHG development and financial intermediation:

Establishing stable linkage between a SHG and a local financial institution is one of the key elements of the SHG

movement. Currently, four distinct models of financial intermediation are in operation in various parts of the country

namely:

• SHG-Bank linkage promoted by a mentor institute • SHG-Bank direct linkage • SHG-Mentor Institution linkage; and • SHG-Federation model

Since the borrowing SHGs consist mainly of low income members who cannot afford to miss even a day’s wages, a

hassle-free transaction with a Bank which is ready to come to their doorsteps with appropriate credit products is of

great value to them. The SHG – Bank Linkage Model with a mentor SHPI in tow (Model I above) would be the most

appropriate one for delivery of financial services to the SHGs.

• Self-Help Groups and RegionalRural Banks:

As on 1st April, 2007, out of a total of 622 districts in the country, 535 have a network of Regional Rural Banks; the

rest 87 districts have no RRB presence. These branches have been created by the Regional Rural Banks Act, 1976

primarily for providing institutional credit to the marginalized sector of the rural economy (small, marginal farmers,

landless labour and rural artisans). Theextension of the RRB network to the remaining 87 districts would considerably

speed up the process of inclusive banking and help in extending micro- finance to local SHGs.

• Issues of sustainability:

The institutional sustainability and the quality of operations of the SHGs are matters of considerable debate. It is

generally held that only a minority of the Self-Help Groups are able to raise themselves from a level of micro-finance

to that of micro-entrepreneurship. Neither do such Bank linkages lead to sanction of larger individual loans under the

Bank’s normal lending programmes. The ultimate objective of such a tie-up is to impart financial strength to the SHGs

so that they can enter into a stable relationship with the local financial institutions - without any external support.


Even after many years of existence, by and large, SHGs are heavily dependent on their promoter NGOs or government

agencies

• Financial assistance toSHPIs and othersupportinstitutions:

Forty-five per cent of the total numbers of women SHGs of the country are located in Andhra Pradesh. This enviable

position of the State is primarily due to the initiative shown by promoter NGOs often known as Self-Help Promoting

Institutions (SHPIs) / mentor organisations. If the SHG movement is to spread across the entire country, there is need

to provide major incentives to SHPIs / promoter NGOs. Currently, the financial support to SHPIs comes from the Micro

Finance Development and Equity Fund (MFDEF) of NABARD. It is limited to an amount of Rs.1500 per SHG (formed

and activated). To attract more and more SHPIs to the rural areas, this quantum of support needs to be revised.

• Role of Micro-Finance Institutions:

Micro-credit is defined as provision of thrift, credit, and other financial services (such as deposits, loans, payment

services, money transfer, insurance and related products) of very small amounts to the poor in rural, semi-urban and

urban areas for enabling them to raise their income levels and improve living standards. Micro-finance institutions are

those which provide such micro-credit facilities. Micro-credit is an instrument of both social as well as economic

policy. It opens up integral development processes such as use of financial and technical resources, basic services and

training opportunities to the unprivileged. Access to savings, credit, money- transfer, payment, and insurance can help

poor people take control of their financial life. It also empowers them to make critical choices about investing in

business, sending children to school, improving health care of the family, covering the cost of key social obligations

and unforeseen situations. But the most important of all, an access to finance generates self- esteem among them.

ARC-2 has made the following recommendations and the Micro Finance Sector (Development and Regulation) Bill,

2007 needs to be amended to include the following suggestions:-

• The scope of Micro-finance Services should be substantially widened to cover credit / savings, insurance, pension services, money transfer, issue / discount of warehouse receipts and future / option contracts for

agricultural commodities and forest produce.

• The activities of Section 25 Companies to the extent they concern micro-financial services as described under the proposed Bill should also be brought under the purview of this legislation. However, for their

management and other functions, they will continue to be governed by the provisions of the Companies Act.

• The issue of interest rate charged by the MFIs should be left to the Regulatory Authority which is being created under the proposed Bill.

• It should be ensured that if MFIs are allowed to handle thrift / savings and money transfer services, they would do so only as business correspondents of commercial Banks.

Q: With an eye on the future, let us explore Corporate-SHG linkages for rural markets:

Rural Market offers tremendous potential of growth for corporations by making their products and services available

to these areas. Lot of interventions are designed by various companies to tap the rural market including designing

tailor made supply chain, rural marketing campaigns, pruning marketing mix elements and integrating social elements

to develop their brand awareness and market for their products. Apart from all these endeavours there is still a

significant area largely untapped. Integration of SHGs with corporations as a part of their company policies in tackling

the issues of reach and market awareness is a win-win solution. With various government initiatives including

Promotion of SHG formation, microenterprise development, microcredit by FIIs and NBFCs and skill training, SHGs are

becoming viable in their operations. Symbiotic association of corporations and SHGs utilizing distinctive competence

can prove to be fruitful for both in the long run broadly in the form of market and socio-economic development. SHGs

are broadly studied on two basis- Microfinance and Microenterprises. The first aspect of SHGs (Microfinance) is widely

studied and several changes have been incorporated towards making SHGs viable. Development of Micro-enterprises

is relatively a new phenomenon. As per study of M.Kunhaman, 2012, SHGs can better promote Micro-enterprises,

especially in rural areas.

The real effort to support SHGs in India, however, came in the late 1990s when the central government of India

introduced a holistic program, SGSY- Swarnajayanti Gram SwarozgarYojana based on the group approach for rural

development. The SGSY approach was to encourage the rural poor to organise themselves into SHGs and to

independently take up viable economic activities as micro-enterprises with support from government subsidies and


bank credit. With the development of industrial norms, micro-enterprises are also coming up apart from large,

medium and small industries. Micro-enterprises can be started and managed by individuals, groups or SHGs. Intended

to strengthen viable, small businesses, resulting in increased household income and savings and thus alleviating the

crunch of economic poverty, Micro-enterprise development aims at building self-esteem, self-reliance, encouraging

autonomy and creating a community atmosphere. It builds economic capital by creating jobs and generating income,

ultimately working towards community development in impoverished or unemployed areas.

The report of the working committee of RBI (1994) proposed the integration of SHGs into the strategies and policies of

corporations. SHGs can provide a suitable option for companies to integrate into various functions such as- Marketing,

Distribution, Procurement of various raw materials and semi-finished materials, Production and processing of

indigenous products etc. For example, TAJ group has adopted a SHG for procurement of sea food and meet 60% of

their demands through the SHG. SHGs can also become a suitable vehicle for distribution of rural products and help in

faster diffusion of innovation in the rural market.

REFERENCES:

• Mohit Bhattacharya- Social Theory and Development Administration • ARC-2 Report 9- Social Capital • Yojana Nov, 2011 issue on NGOs



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without prior permission of Vision IAS

Corporate Needs:

Business Expansion

Greater Market Segment

Product Penetration & Diffusion

Brand Awareness

SHG Needs:

Scale of Production

Marketability

Production Methods

Capital, Technology and Skills


(A)

G.S. PAPER II – SOCIAL JUSTICE

Welfare Schemes for Vulnerable Sections of the Population by the

Centre and States and the Performance of these Schemes

Mechanisms, Laws, Institutions and Bodies Constituted for the

Protection and Betterment of these Vulnerable Sections

VISIONIAS ™ www.visionias.in

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14



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Q1. How would you define the term ‘vulnerable sections’?

There are various ways to define who vulnerable sections are. Consider for instance the following definitions:

• A vulnerable section in a population is one that has some specific characteristics that make it at higher risk of falling into poverty than others. Vulnerable sections include the elderly, the mentally and physically disabled,

at-risk children and youth, ex-combatants, internally displaced people and returning refugees, HIV/AIDS-

affected individuals and households, religious and ethnic minorities and, in some societies, women. (World

Bank)

• People who are long-term unemployed, and also others who are inactive but not registered as unemployed. It should include workers who are in some form of employment but are at a high risk of losing their jobs. It is,

therefore, a very heterogeneous group, whose members share perhaps only the involuntary character of

their present status. (Atkinson, 2000)

• Groups that experience a higher risk of poverty and social exclusion than the general population. Ethnic minorities, migrants, disabled people, the homeless, those struggling with substance abuse, isolated elderly

people and children all often face difficulties that can lead to further social exclusion, such as low levels of

education and unemployment or underemployment. (European Commission)

Q2. Is there a fixed criterion on the basis of which vulnerability can be defined?

There are multiple and complex factors behind vulnerability with different layers and it often cannot be analyzed in

isolation. Further, a section of the population may face discrimination on a number of grounds due to their multiple

identities. For example, in a patriarchal society, disabled women face double discrimination of being a women and

being disabled. So it is difficult to provide a fixed criterion or classify vulnerable sections into separate watertight

compartments.

However, for our purposes we can identify the prominent factors on the basis of which individuals or members of

groups are discriminated in India, as structural factors, age, disability, caste, class, gender etc. It is usually these

factors, which become the basis of discrimination and vulnerability.

Q3. On basis of the above definitions and criteria which sections do you think we can include as being ‘vulnerable’

in India?

If we use the above criteria and definitions, in the context of India, we can include the following sections as vulnerable

sections:

• Differently Abled Persons • Old age people/ Senior Citizens • Orphans and Street Children • Women • Sexual Minorities • Schedule Caste/ Schedule Tribe/ Minorities/ Other Vulnerable groups

Q4. So now we know the sections that are vulnerable in India. But we don’t yet know whether it is an individual or

a group phenomenon. Discuss.

Vulnerability is not confined to individuals, rather relates to groups or sections. Thus, a social component is usually

involved. This is particularly true in the case of India where inequality and exclusion are facts of life. Thus, some

people not only have a greater share of valued resources – money, property, education, health, and power – than

others, but social identities play a dominant role in acquiring these resources.

This can be more easily understood if we divide these social resources into three forms of capital- economic capital in

the form of material assets and income; cultural capital such as educational qualifications and status; and social

capital in the form of networks of contacts and social associations. Often, these three forms of capital overlap and one

can be converted into the other. For example, a person from a well-off family (economic capital) can afford expensive


higher education, and so can acquire cultural or educational capital. Someone with influential relatives and friends

(social capital) may – through access to good advice, recommendations or information – manage to get a well-paid

job.

A section of society that lacks a plurality of these resources is more prone to discrimination than others in a number of

spheres.

Q5. We mentioned that caste is one of the factors on the basis of which individuals or members of groups are

discriminated in India. Explain how caste can perpetuate vulnerability among some sections of our population?

The caste system is a distinct Indian social institution that legitimizes and enforces practices of discrimination against

people born into particular castes. These practices of discrimination are humiliating, exclusionary and exploitative.

Historically, the caste system classified people by their occupation and status. In actual practice both economic and

social status tended to coincide. There was thus a fairly close correlation between social (i.e. caste) status and

economic status – the high castes were almost invariably of high economic status, while the ‘low’ castes were almost

always of low economic status.

Even now the caste-class correlation is still remarkably stable at the macro level. As the system has become less rigid,

the distinctions between castes of broadly similar social and economic status have weakened. Yet, between different

socio-economic groupings, the distinctions continue to be maintained. Therefore, caste continues to affect the life

chances of Indians in the twenty-first century.

Q6. It is often mentioned that untouchability is an extreme and particularly vicious aspect of the caste system.

Explain what untouchability is and analyze the vulnerable status of dalits in the light of untouchability practiced in

the caste system.

Untouchability is indeed an extreme and particularly vicious aspect of the caste system that prescribes stringent

sanctions against members of castes located at the bottom of the caste pyramid. Notions of ‘distance pollution’

existed in many regions of India for a long time.

However, untouchability refers not just to the avoidance or prohibition of physical contact but to a much broader set

of social sanctions. For instance, it is almost always associated with economic exploitation of various kinds, most

commonly through the imposition of forced, unpaid (or under-paid) labour, or the confiscation of property. There are

three main dimensions of untouchability- namely exclusion, humiliation-subordination and exploitation – all are

equally important to understand the phenomenon.

Although other (i.e., ‘touchable’) low castes are also subjected to subordination and exploitation to some degree, they

do not suffer the extreme forms of exclusion reserved for ‘untouchables.’ Dalits experience forms of exclusion that

are unique and not practiced against other groups – for instance, being prohibited from sharing drinking water

sources or participating in collective religious worship, social ceremonies and festivals. At the same time,

untouchability may also involve forced inclusion in a subordinated role, such as being compelled to play the drums at

a religious event. The performance of publicly visible acts of (self-) humiliation and subordination is an important part

of the practice of untouchability. Further, it is a pan-Indian phenomenon, although its specific forms and intensity vary

considerably across regions and socio-historical contexts.

The word ‘Dalit’ which has been coined to refer to the ex-untouchable community means ‘downtrodden’ and conveys

the sense of an oppressed people. Though it was not coined by Dr. Ambedkar, it resonates with his philosophy and the

movement for empowerment that he led.

Q7. It is evident that untouchability is an extremely exploitative system that has been in practice for ages. Does the

Constitution of India contain any provision to curb its practice?

Yes, the Constitution abolished untouchability and its practice in any form. Article 17 of the Constitution

(Fundamental Right) that abolishes untouchability has been provided without any exception. It empowers the State to


prescribe by law providing punishment for the practice of untouchability. The Parliament enacted the Untouchability

Offences Act, 1955 which has been subsequently amended and renamed as the Civil Rights Protection Act, 1976. It

provides stringent punishment for the practice of untouchability. However, neither the Constitution nor the law

defines what untouchability is. But the Judiciary has defined it as a social practice among the Hindus where a person is

looked down upon and discriminated against solely on the basis of his birth.

Q. 8 Given the vulnerable status of Scheduled Castes, the Constitution includes certain provisions for their welfare.

List them.

The Constitution includes the following provisions for the Scheduled castes:

• Article 15(4): It was introduced by the first Amendment Act after the SC judgment in the case of Champakam Dorairajan vs. State of Madras. Under this the State can make special provisions for the advancement of

socially and educationally backward class of citizens including SCs and STs.

• Article 16(4): This clause allows the state to reserve vacancies in public service for any backward classes of the state that are not adequately represented in the public services.

• Article 16 (4A): It empowers the State to provide by law for the reservation of seats in favour of SCs and STs in public employment in promotions.

• Article 16(4B): It states the carry forward policy followed in favour of SCs and STs where the unfilled vacancies of the SCs and STs in a particular year are carried forward to the following years and filled up from among SCs

and STs. It provides that the carry forward policy would be valid even if the overall reservation exceeds 50% in

the subsequent years.

• Article 40: Provides reservation in one-third seats in Panchayats to SC/ST. • Article 46: Enjoins the states to promote with care the educational and economic interests of the weaker

sections, specially SC and STs.

• Article 330/332: Allows reservation of seats for SC/ST in the parliament as well as in state legislatures. • Article 335: It sates that claims of the members of the Scheduled Castes and the Scheduled Tribes shall be

taken into consideration, consistently with the maintenance of efficiency of administration, in the making of

appointments to services and posts in connection with the affairs of the Union or of a State

• Article 338/338A/339: Establishes a National Commission of SCs and STs. Article 339 allows the central govt. to direct states to implement and execute plans for the betterment of SC/STs.

• Article 340: Allows the President to appoint a commission to investigate the condition of socially and economically backward classes and table the report in the parliament.

Q. 9 In addition to the Constitutional provisions, the Government of India has also constituted certain mechanisms,

laws, institutions and bodies for their protection and betterment. Discuss.

The Ministry of Social Justice and Empowerment is the nodal Ministry to oversee the interests of the Scheduled

Castes. Under the Scheduled Castes Development Bureau, the Ministry implements Scheduled Castes Sub-Plan (SCSP)

which is an umbrella strategy to ensure flow of targeted financial and physical benefits from all the general sectors of

development for the benefit of Scheduled castes. Under the strategy, states/UTs are required to formulate and

implement Special Component Plan (SCP) for Scheduled Castes as part of their Annual Plans by earmarking resources.

Another policy initiative for the development of Scheduled Castes is Special Central Assistance to Special Component

Plan, in which cent percent assistance is given as additive to Scheduled Caste Sub-Plan of the States/UTs on the basis

of certain criteria such as SC population of the States/UTs, relative backwardness of the States/UTs, percentage SC

families in the States/UTs, covered by composite economic development programmes in the State Plan to enable

them to cross the poverty line, percentage of SCP to the Annual Plan as compared to SC population percentage of the

States/UTs.

The Ministry implements two acts for protecting the civil rights of the Scheduled Castes, viz.:

• Protection of Civil Rights Act, 1955; and • The Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities Act, 1989)


Constitutional Measures:

• National Commission for Scheduled Castes

The National Commission for Scheduled Castes, a Constitutional body monitors the safeguards provided for

Scheduled Castes and also reviews issues concerning their welfare. The Commission has wide powers to protect,

safeguard and promote the interests of the SCs. The Commission has been conferred powers of a civil court trying a

suit, to summon and enforce the attendance of any persons from any part of India and examining on oath, receiving

evidence on affidavits.

• National Commission for Safai Karmacharis

The National Commission for Safai Karmacharis, a statutory body has, inter-alia, been empowered to

investigate into specific grievances as well as matters relating to implementation of programmes and schemes for

welfare of Safai Karmacharis.

• Protection of Civil Rights Act, 1955

In pursuance of article 17 of the Constitution of India, the Untouchability (Offences) Act, 1955 was enacted.

Subsequently it was amended and renamed in the year 1976 as the “ Protection of Civil Rights Act, 1955”. Rules

under this Act, viz. “The Protection of Civil Rights Rules, 1977” were notified in 1977. The Act extends to the

whole of India and provides punishment for the practice of untouchability. It is implemented by the respective

State Governments and Union Territory Administrations.

• Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989

The Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989, specifies offences, which are

considered as atrocities, and provides for deterrent punishments for commission of the same. Comprehensive Rules

were also framed under the SCs and STs (POA) Act in 1995, which among other things provided for relief and

rehabilitation of the affected people.

• Committee to review implementation of PCR and POA Acts

Educational Development

• Pre Matric Scholarship • Pre-Matric Scholarships for Children of those engaged in Unclean Occupations: • Rajiv Gandhi National Fellowship Scheme • National Overseas Scholarship • Upgradation of Merit for SC Students • Free Coaching for SCs and OBCs • Babu Jagjivan Ram Chhatrawas Yojana • Dr. Ambedkar Foundation

Economic Empowerment

• Special central Assistance to Scheduled Castes Sub Plan (SCSP) • Assistance to State Scheduled Castes Development Corporations • National Scheduled Castes Finance Development Corporation • Self-Employment Scheme for Rehabilitation of Manual Scavengers (SRMS) • Voluntary Organizations Working for the Welfare of SCs • National Safai Karamcharis Finance and Development Corporation

(Refer the chapter on Welfare in India Year Book and Economic Survey for details of these schemes).


Q. 10 Adivasis or tribals are another section of the population who often face discrimination. Explain who they are

and why they are included as a vulnerable section.

Tribes or Adivasis in India have generally been defined in terms of what they were not. Tribes were defined as

communities that did not practice a religion with a written text; did not have a state or political form of the normal

kind; did not have sharp class divisions; and, most important, did not have caste and were neither Hindus nor

peasants.

Like the Dalits, Tribes as social groups were recognized by the Indian Constitution as specially marked by poverty,

powerlessness and social stigma. They were believed to be ‘people of the forest’ whose distinctive habitat in the hill

and forest areas shaped their economic, social and political attributes. However, their long and close association with

Hindu society and culture, made the boundaries between ‘tribe’ and ‘caste’ quite porous.

In the areas where tribal populations are concentrated, their economic and social conditions are usually much worse

than those of non-tribals. The impoverished and exploited circumstances under which adivasis live can be traced

historically to the pattern of accelerated resource extraction started by the colonial British government and continued

by the government of independent India. The independence of India in 1947 should have made life easier for adivasis

but this was not the case. Firstly, the government monopoly over forests continued. If anything, the exploitation of

forests accelerated. Secondly, the policy of capital-intensive industrialization adopted by the Indian government

required mineral resources and power-generation capacities which were concentrated in Adivasi areas. Adivasi lands

were rapidly acquired for new mining and dam projects. In the process, millions of adivasis were displaced without

any appropriate compensation or rehabilitation. Justified in the name of ‘national development’ and ‘economic

growth’, these policies were actually a form of internal colonialism, subjugating adivasis and alienating the resources

upon which they depended.

Q. 11 Mention the Constitutional provisions and other laws and institutions established for the welfare of

Scheduled Tribes.

Constitutional Provisions:

Refer the Constitutional provisions mentioned above for Scheduled castes. Apart from them, certain other articles

deal exclusively with problems faced by STs. They are as follows:

• Article 19(5): It allows the state to impose restriction on freedom of movement or of residence in the benefit of Scheduled Tribes.

• Article 164: Appoint special minister for tribal welfare in the states of MP, Bihar, and Orrisa. • Article 275: Allows special grant in aids to states for tribal welfare.

Other welfare schemes, laws, mechanisms, bodies and institutions:

• Scheduled Areas and Tribal Areas

Scheduled Tribes live in contiguous areas unlike other communities. It is, therefore, much simpler to have an

area-approach for development activities and also regulatory provisions to protect their interests.

In order to protect the interests of Scheduled Tribes with regard to land alienation and other social factors,

provisions of ‘‘Fifth Schedule and “Sixth Schedule” have been enshrined in the Constitution.

The Fifth Schedule under Article 244(1) of Constitution defines ‘‘Scheduled Areas" as such areas as the

President may by Order declare to be Scheduled Areas after consultation with the Governor of the State.

The Sixth Schedule under Article 244 (2) of the Constitution relates to those areas in the States of Assam,

Meghalaya, Tripura and Mizoram which are declared as ‘‘Tribal Areas" and provides for District Councils and/or

Regional Councils for such Areas. These Councils have been conferred with wide ranging legislative, judicial and

executive powers.


• The Fifth Schedule Areas

The criteria for declaring any area as a ‘‘Scheduled Area" under the Fifth Schedule are: (a) Preponderance of

tribal population, (b) Compactness and reasonable size of the area, (c) A viable administrative entity such as a

district, block or taluk, and (d) Economic backwardness of the area as compared to neighbouring areas.

The advantages of Scheduled Areas are as follows:

o The Governor of a state, which has Scheduled Areas, is empowered to make regulations in respect of the following:

a. Prohibit or restrict transfer of land from tribal people; b. Regulate the business of money lending to the members of Scheduled Tribes.

o The Governor may be public notification direct that any particular Act of Parliament or of the Legislature of the State, shall not apply to a Scheduled Area or any part thereof in the State or shall

apply to such area subject to such exceptions and modifications as he may specify.

o The Governor of a State having Scheduled Areas therein, shall annually, or whenever so required by the President of India, make a report to the President regarding the administration of the Scheduled

Areas in that State and the executive power of the Union shall extend to the giving of directions to

the State as to the administration of the said area.

o Tribes Advisory Council (TAC) shall be established in States having Scheduled Areas. The role of TAC is to advise the State Government on matters pertaining to the welfare and advancement of the

Scheduled Tribes in the State as may be referred to it by the Governor.

o The Provisions of the Panchayats (Extension to Scheduled Areas) Act, 1996 (PESA) which were extended to Scheduled Areas, also contain special provisions for the benefit of Scheduled Tribes.

• The Sixth schedule – Tribal Areas

The Sixth Schedule under Article 244 of the Constitution identifies Autonomous districts in the Tribal Areas in

the states of Assam, Meghalaya, Tripura and Mizoram. It also makes provisions for recognition of

Autonomous Regions within these Autonomous Districts. These have been specified in Parts I, II, IIA & III of

the table appended to paragraph 20 of the Sixth Schedule. In other words, areas where provisions of Sixth

Schedule are applicable are known as Tribal Areas. The State-wise details of Tribal Areas are as under:

o Part-I Assam 1. The North Cachar Hills District 2. The Karbi-Anglong District 3. The Bodo Land Territorial Area Districts

o Part II Meghalaya 1. Khasi Hills District 2. Jaintia Hills District 3. The Garo Hills District

o Part IIA Tripura 1. Tripura Tribal Areas District

o Part III Mizoram 1. The Chakma District 2. The Mara District 3. The Lai District

The administration of Autonomous Dis

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